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Connections with Leading Thinkers: Antonio Botelho

As part of the Accenture Institute for High Performance's mission to develop cutting-edge new ideas and insights, researchers often seek the views of academic leaders, business executives and industry analysts. The Connections with Leading Thinkers series captures some of those interviews, showcasing interactions and discussions with some of the world's leading experts.

Antonio Botelho is director and former CEO (2011-14)
of Gávea Angels, an angel investment group in Brazil,
and professor of Innovation Policy and Entrepreneurship
at the Rio de Janeiro Institute for University Research
(IUPERJ), a postgraduate unit of University Cândido
Mendes. Eduardo Plastino of the Accenture Institute for
High Performance interviewed him as part of a research
project on innovation in the Brazilian economy.

In your different professional roles,
you’re in a good position to observe
the innovation space in Brazil. What
assessment do you make of its current
state and direction?

We are still lagging behind when
it comes to innovation. You see that in the
business world, where companies face a
plethora of difficulties, and in the policy
world, where the country still lacks a coherent
innovation strategy. When it comes to policy,
different government agencies offer a large
number of innovation-related programs. This
creates confusion and leads to duplication
of efforts. We need clarity about where these
different innovation-related initiatives are
taking our economy.

But isn’t it true that innovation
efforts have been incorporated into the
country’s wider industrial policy?

That attempt has been made,
but careful analysis shows that we still have
an old-fashioned, protectionist industrial
policy. The penny hasn’t dropped for our
policymakers that innovation policy must be
dynamic. For about five years, I wrote reports
for the EU about Brazilian innovation and
science policy. The EU policymakers’ objective
was to understand what was going on around
the world, so they could refine their own
practices as quickly as possible, given that
speed is critical in the innovation game. Here,
unfortunately, we don’t monitor what is going
on elsewhere in terms of innovation policy,
let alone use that knowledge to inform our
own policies and to update them in real time.

This is not to say we haven’t seen some
progress in terms of innovation policy in
Brazil. We have some modern policy tools
that support start-ups and entrepreneurship,
which are key for innovation. However, they
have been in place for only four or five years—so we are latecomers to this game.

Yet there seems to be strong
momentum behind entrepreneurship
and start-ups in Brazil right now.

It’s good that people are seeing
entrepreneurship more favorably, but to make
the most of it, we have to address a number
of issues. For example, we now have the
Start-Up Brazil program, modelled after
Start-Up Chile, which preceded it by half
a decade. It’s great that we have this
program, but it lacks a wide enough vision.
Start-Up Chile has a strategic vision aimed
at addressing a number of deficiencies in
the Chilean economy. Another serious issue
here is the poor education of most of our
entrepreneurs. Few are prepared to navigate
in today’s economy. I see this very clearly as
an angel investor.

What explains this inadequate
education?

Opportunities to build capabilities
and knowledge related to entrepreneurship
are located in the wrong places in Brazil.
You can take entrepreneurship courses
in a number of places such as Sebrae
(a quasi-state agency that supports micro
and small businesses) and universities. But
in universities, most of those courses are
offered at the undergraduate level, which
is not the most appropriate level. We need
many more such courses at the postgraduate
level, from where innovative entrepreneurs
are more likely to emerge. At Gávea Angels,
we see entrepreneurs submitting financing
requests who don’t know how to analyze the
market or make good use of the money they
are asking for. As a country, we need a better
understanding of the true nature of successful
entrepreneurship.

Could you say more about what
you mean by that?

It’s great that people want to
start new businesses, but they need to think
about the business’ ability to innovate and
grow in the long term. Just having new
businesses is not enough in itself. Sebrae,
for example, offers great services, but they
seem to believe we should preserve companies
no matter what. I believe that inefficient
companies shouldn’t be kept alive, and that
we don’t let them die as soon as we should.
Our entire system seeks to keep all companies
going. We need to think about which
companies should be supported. And we
must focus on those that are generating the
most innovation and knowledge, those that
can have a positive impact on an industry,
a supply chain or a region.

You are also an academic. What
role do universities play in innovation
efforts in Brazil?

Unfortunately, with a few
exceptions, our academia is poorly prepared
to innovate. Most of our universities have a
culture that is not conducive to innovation.
In this culture, academia is seen as something
isolated from the economy. On top of that,
we don’t have the right incentives. Academics
progress in their career only if they publish
new papers all the time. Participating in
innovation efforts isn’t very useful for them
in that sense.

Despite that, do you see examples of
successful collaboration between businesses
and universities in Brazil?

Yes, and the best examples are
those in which academic researchers and
people in the companies they have worked
with managed to build a relationship of
trust. But trust can emerge only if certain
mechanisms are in place.

What would those mechanisms be?

We need rules governing
collaboration that are clear but that also
give all sides some flexibility to adapt their
work to their needs. Today, many researchers
are collaborating with the private sector
but outside the university framework. This is
because most leading universities in Brazil
are public (state-owned) and have rigid rules
about collaboration with businesses. This
creates uncertainty, because researchers
never know what they will be allowed to do.
And they would often have to circumvent
some pointless rules to achieve something
worth working on.

Also, in some situations, the government
offers financing to support joint efforts
between universities and companies. But
the money comes too late, or the university’s
execution of the project is delayed. This
discourages companies from seeking that
kind of partnership.

In short, we need to think more strategically
about long-term cooperation between
academia and business. When we have the
right conditions for trust to emerge, this
relationship will become more sustainable,
and we will see a strong flow of innovations.

Is there also a lack of trust
between companies in Brazil? If so, what
steps could companies take to engage
with other firms in existing or potential
innovation ecosystems?

You can only trust who you
know, so to build trust with other firms,
companies need to interact more often
with each other. They also need clear rules
regarding how any rewards coming from their
engagements with others will be shared. But
the problem in Brazil is that our corporate
culture is powerfully shaped by the large role
that family firms play in our economy. In
traditional family firms, contact with outsiders
is discouraged. You must keep everything in
the family.

A famous Brazilian anthropologist, Roberto
da Matta, discussed how, in this country,
“house” is a place of order and reliability,
while “the street” is a place of competition
and struggle—a place where you could suffer
painful losses. This logic influences our
business world and discourages collaboration
between companies. That’s because it makes
it hard for business people to envision win-win
possibilities they could capture by working
with other companies.

In addition, many family firms are large,
vertically integrated and diversified groups.
That kind of company tends not to focus
on its core capabilities and seek cooperation
with other, smaller firms.

How, then, can start-ups and other
small companies improve their chances
of collaborating with large organizations?

These companies should grow
a bit before seeking to appear on large firms’
radar screens as potential collaboration
partners. Even when they are innovative,
small companies are weak, not least because
many of them have poor management skills.
Therefore, the first step for them is to build
up their size and capabilities.

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